Moniepoint has officially received the green light from the Competition Authority of Kenya (CAK) to acquire a controlling 78 per cent stake in Sumac Microfinance Bank Limited, marking a major step for the Nigerian fintech’s entry into Kenya’s financial sector. This approval, announced on Monday, follows the collapse of Moniepoint’s earlier attempt to acquire KopoKopo, another Kenyan fintech firm.
Moniepoint enters Kenyan microfinance market
The acquisition of Sumac Microfinance Bank offers Moniepoint a direct foothold in Kenya’s mobile payments and microfinance banking market, valued at approximately $67.3 billion (KES 8.7 trillion). Sumac, established in 2002 and licensed as a microfinance bank by the Central Bank of Kenya (CBK), serves nearly 44,000 active loan accounts and holds a 4.3 percent share of Kenya’s microfinance sector.
Sumac’s evolution from a small savings group, or “chama,” into a licensed microfinance bank highlights its deep roots in Kenya’s financial ecosystem. The bank provides services, including SME loans, deposits, money transfers, and forex trading. Moniepoint’s acquisition will enable fintech to bypass the lengthy regulatory process often required for new entrants by acquiring an already licensed institution.
According to the CAK, the acquisition will not negatively impact competition or public interest. The authority emphasised that there will be no job losses, with all current Sumac employees retained under existing terms. This reassures stakeholders about the stability and continuity of Sumac’s operations post-acquisition.
Overcoming the KopoKopo setback: A new path for Moniepoint
Moniepoint’s initial plan to acquire KopoKopo, a Kenyan payments firm, was approved by CAK in August 2024 but later fell through for undisclosed reasons. The successful acquisition of Sumac represents a strategic pivot, allowing Moniepoint to enter Kenya’s market through a licensed microfinance bank rather than a payment service provider.
Moniepoint, established in 2015 by Felix Ike and Tosin Eniolorunda, is headquartered in Nigeria and operates through subsidiaries such as Moniepoint Microfinance Bank and TeamApt. It is registered in the U.S. and operates primarily in Nigeria and the U.K. This deal marks its first major investment in East Africa.
The acquisition aligns with a growing trend of fintech companies entering new markets by acquiring local licensed financial institutions. This offers a faster route to market presence than building operations from scratch. Its subsidiaries process $17 billion monthly for customers while maintaining profitable operations.
The CAK’s approval highlights that Moniepoint’s entry will not reduce competition in Kenya’s microfinance sector, which includes 14 licensed microfinance banks categorised by size. Sumac is among the medium-sized players, contributing around 15 per cent to the sector alongside five large banks that dominate 83.8 per cent of the market.
Moniepoint’s acquisition of Sumac will bring fresh capital and innovation, potentially expanding Sumac’s reach and enhancing Kenya’s fintech ecosystem. This move also signals increased investor confidence in Kenya’s financial services market, particularly from international fintech firms seeking strategic partnerships or acquisitions.
The Competition Authority of Kenya’s statement on Monday, confirmed the unconditional approval of the acquisition, emphasising that the transaction meets all regulatory requirements under the Competition Act and will not harm public interest or market competition.